No.

Conditions with initial filings due during construction / prior to

commencing operations

CPCN

OC2

OC49

Temp

Pump1

Pump2

Tanks

Deact

National Energy Board

476

1

86 In the context of this condition, “operations phase” refers to the period after the Project receives leave to open approval and prior to it being

fully abandoned.

120

Notification and reporting on emergency response exercises

For any tabletop, functional, and full-scale emergency response exercises undertaken as part

of its Emergency Preparedness and Response Exercise and Training Program required by

Condition 119:

a) Trans Mountain must notify the NEB and all potential exercise participants and

observers, including Appropriate Government Authorities, first responders and

potentially affected Aboriginal groups,

at least 45 days prior to the date of each

exercise

, of:

i)

the exercise’s date and location(s);

ii) the exercise’s objectives;

iii) the participants in the exercise; and

iv) the scenario for the exercise.

b) Trans Mountain must file with the NEB, and provide to Appropriate Government

Authorities, first responders and potentially affected Aboriginal groups,

within 3

months after completing each

full-scale exercise, a report on the exercise that includes:

i)

the results of the completed exercise;

ii) areas for improvement; and

iii) steps to be taken to correct deficiencies.

X

X

X

121

Financial Assurances Plan – operations phase

a) Trans Mountain must file with the NEB for approval,

at least 6 months prior

to applying for leave to open Line 2

, a Financial Assurances Plan that includes

details of the financial resources and secured sources of funds that will be

necessary to pay, without limitation, all actual loss or damage, costs and

expenses, including cleanup and remediation, and loss of non-use value relating

to non-use of a public resource associated with an unintended or uncontrolled

release from the Project during the operations phase.

86

These costs may arise

from, among other things, potential accidents, malfunctions, and failures during

the Project operations phase, including all spills originating from the pipeline

and the terminals.

The Financial Assurances Plan must be signed by an officer of the company,

verifying that it is accurate, complete, and, at a minimum, meets the criteria and

coverage levels described below:

i)

Criteria for financial assurance instruments and plan:

1) Any letter of credit that forms part of the Financial Assurances Plan must be

unconditional and irrevocable, segregated from Trans Mountain's day-to-day

business activities, and be dedicated to providing funds to cover the costs

described in sub a) above, without limitation.

2) Third party liability insurance must be current, and broad, respecting the

scope of environmental damages covered by the policy; the policy will

be consistent with provisions available in the insurance market (i.e., only

exceptional/non-standard perils, taking into account the Project's nature

and scope, would be excluded from coverage). Such insurance must be

structured on a multi-year basis, recognizing potential loss of income by

persons sustaining damage caused by Trans Mountain, over a reasonable

number of years after the event.

3) A portion of cash reserves or a portion of future cash flows of the Project

may be included as instruments in the Financial Assurances Plan, provided

they are secured by a commitment letter from an officer of the company

confirming that the funds will be dedicated to the Financial Assurances Plan

without restrictions for the period specified by the officer.

X

X

X

X

X